AB InBev beats Q3 revenue and profit expectations on premium brands

Anheuser-Busch InBev posted third-quarter profits and revenue that beat consensus forecasts, driven by strong pricing power and premiumization, though rising commodity, distribution, and marketing costs weighed on margins and highlighted deep regional headwinds in China.

The maker of Budweiser reported underlying earnings per share of $1.21 for the third quarter of 2026, beating the $1.15 analyst consensus forecast, as higher prices for its premium lagers boosted revenue per hectoliter by 4.2%. 

Total revenue rose 4.9% to $16.51 billion, topping expectations of 4.1% growth, while total organic volumes grew 0.4% against a projected 0.3%.

Normalized earnings before interest, taxes, depreciation and amortization (EBITDA) reached $5.96 billion, matching the consensus growth estimate of 3.9%. 

However, profitability margins shrank to 36.1% from 37% a year earlier due to increased sales and marketing expenses to promote key brand platforms alongside elevated commodity and freight charges.

Underlying profit reached $2.40 billion compared with $1.97 billion in the third quarter of 2025. Reported profit attributable to equity holders stood at $1.60 billion, up from $1.05 billion in the prior-year period.

Global performance was dragged down by a steep drop in China, where volumes fell 16.8% as abnormal weather and weakness in restaurants and bars depressed industry demand. 

“Company has absorbed weakness in Asia, delivering another quarter of positive vols and the street continues to underestimate mix, which is an important enabler of growth,” said analysts at Jefferies.

In contrast, volume growth in the Middle Americas rose 7.3%, led by market share expansion in Mexico. In the United States, revenue fell 1.2% as sales to retailers dropped 3.1% in a soft market.

To reward shareholders, AB InBev’s board approved an interim dividend of 0.40 euros per share for fiscal year 2026, up from 0.15 euros per share in 2025. The company has also executed $2.60 billion of its $6.00 billion share buyback program. 

Jefferies noted the earnings beat adds over 1% to full-year consensus estimates and expected shares to trade modestly higher.

For full-year 2026, AB InBev reiterated its forecast for EBITDA growth between 4% and 8%. It projects full-year net capital expenditure between $3.50 billion and $4.00 billion.

"Delivering solid growth today while investing for tomorrow - our portfolio of megabrands and mega platforms continues to win with consumers," CEO Michel Doukeris said.